To find the new balance at the end of month 7, we need to follow these steps:
1. Identify the given data for month 7:
- Previous balance: \[tex]$74.33
- New charges: \$[/tex]99.00
- Payment received: \[tex]$91.98
- Finance charges: \$[/tex]2.04
2. Calculate the principal paid:
The principal paid is the portion of the payment that goes towards reducing the balance, not including finance charges. This can be calculated as:
[tex]\[
\text{Principal paid} = \text{Payment received} - \text{Finance charges}
\][/tex]
Substituting the values:
[tex]\[
\text{Principal paid} = 91.98 - 2.04 = 89.94
\][/tex]
3. Calculate the new balance:
The new balance is found by taking the previous balance, adding new charges, subtracting the payment received, and then adding the finance charges:
[tex]\[
\text{New balance} = \text{Previous balance} + \text{New charges} - \text{Payment received} + \text{Finance charges}
\][/tex]
Substituting the values:
[tex]\[
\text{New balance} = 74.33 + 99.00 - 91.98 + 2.04
\][/tex]
Simplifying further:
[tex]\[
\text{New balance} = 74.33 + 99.00 - 91.98 + 2.04 = 83.39
\][/tex]
Thus, the new balance at the end of month 7 is \[tex]$83.39.
So, the correct answer is:
D. \$[/tex]83.39
